Rising pump prices begin to reshape demand as Nigeria’s deregulated fuel market shows early signs of consumer pullback…..
Nigerians consumed an estimated 4.93 billion litres of Premium Motor Spirit (petrol) in the first three months of 2026, reflecting a notable increase compared to the same period last year, even as demand began to soften toward the end of the quarter.
Data compiled from the downstream fact sheets of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) shows that total consumption rose by 7.4 per cent from the 4.59 billion litres recorded in the first quarter of 2025.
However, beneath the year-on-year growth lies a more nuanced story: a steady decline in monthly consumption that points to shifting consumer behaviour in response to rising fuel prices and evolving market dynamics.
Average daily consumption dropped consistently across the quarter from 60.2 million litres in January to 56.9 million litres in February, before falling more sharply to 47.3 million litres in March. The pattern suggests that while demand remained strong at the start of the year, it weakened significantly as the quarter progressed.
A breakdown of the figures shows that January recorded approximately 1.87 billion litres of petrol consumption. This fell to about 1.59 billion litres in February and declined further to roughly 1.47 billion litres in March. Altogether, this represents a cumulative drop of about 400 million litres between January and March, a 21.4 per cent decrease within just three months.
Month-on-month analysis highlights the speed of the decline. Consumption fell by 273 million litres between January and February, followed by an additional drop of 127 million litres between February and March.
Despite this downward trend, overall demand in 2026 still outpaced 2025 levels. In the corresponding period last year, Nigerians consumed about 1.60 billion litres in January, 1.41 billion litres in February, and 1.58 billion litres in March, bringing the total to 4.59 billion litres. This means the 2026 figure exceeded 2025 by roughly 339 million litres.
A closer comparison shows mixed performance across individual months. January 2026 consumption surged by nearly 17 per cent compared to January 2025, while February recorded a 12.9 per cent increase year-on-year. In contrast, March 2026 fell 7.1 per cent below its 2025 level, marking a clear shift in demand dynamics.
That March slowdown is particularly significant. It suggests that consumers are beginning to respond more directly to fuel pricing in a market that is now largely deregulated. Since the removal of fuel subsidies, petrol prices have become increasingly tied to global crude oil trends, exchange rate fluctuations, and domestic refining costs.
The impact of these factors became more visible during the quarter. Notably, the Dangote Refinery adjusted petrol prices multiple times, with pump prices climbing to around N1,275 per litre in March.
Higher prices appear to have triggered behavioural changes. Transport operators, businesses, and households are likely scaling back consumption, while some users are turning to alternatives such as compressed natural gas or reducing non-essential travel.
At the same time, supply conditions are improving. Increased domestic refining, driven largely by facilities like the Dangote refinery has enhanced product availability and reduced reliance on imports. Yet, stronger supply has not translated into higher consumption, underscoring a key reality of the new market environment: affordability now plays a decisive role.
The data points to a growing tension between availability and pricing. While fuel is becoming more accessible, elevated costs are limiting how much consumers are willing or able to use.
Looking ahead, petrol consumption trends are expected to remain closely tied to price movements, inflationary pressures, and overall economic activity. The first-quarter figures suggest that although demand remains relatively strong on a yearly basis, the sharp drop in March could be an early indicator of a more sustained adjustment as consumers adapt to higher energy costs.
